Ten years after adopting the policy, Notre Dame remains the
only major U.S. university that forbids license holders such as
Adidas AG (ADS) to put the school logo on any product from China,
according to groups that track college merchandising.

Notre Dame prohibits the goods because China, the top
source of U.S. imports, doesn’t permit independent labor unions,
according to a college policy document. The ban is attracting
fresh attention from Washington lawmakers who say China has
begun a renewed crackdown on dissidents.

“What Notre Dame is doing is very, very important,”
Representative Frank Wolf, a Virginia Republican and chairman of
the Appropriations Committee panel that oversees trade, said in
an interview. “China is a particularly bad place to do
outsourcing, and the American people are totally opposed to
it.”

Wolf said he will press Virginia universities to impose a
similar ban and ask colleagues in Congress to get their
constituent groups to follow the lead of South Bend, Indiana-
based Notre Dame.

$4.3 Billion Market

College-branded products are a $4.3 billion-a-year
business, according to Collegiate Licensing Co., which helps
schools manage their trademarks. In its most recent rankings,
Notre Dame was 11th in licensing revenue among almost 200
colleges tracked by the Atlanta-based unit of sports agency IMG
Worldwide Inc.

The University of Texas tops the list with $10.15 million
in revenue from licensing in the last fiscal year. Notre Dame
doesn’t disclose how much it makes. Among leading suppliers are
Electronic Arts Inc. (ERTS), the video-game publisher, and Nike Inc. (NKE),
the largest maker of athletic shoes.

Under pressure from students protesting conditions for
workers sewing shirts or stitching soccer balls in nations such
as Honduras and the Dominican Republic, about half of major
universities in the past decade have adopted codes of conduct
for suppliers of companies that license their brands, including
Texas and Notre Dame, according to Collegiate Licensing.

“This was galvanized by campus action,” Liz Kennedy, vice
president of the company, said in an interview. While many
institutions have standards for purchases, only Notre Dame has a
countrywide boycott, she said.

Consumer Backlash

Chinese-made products dominate U.S. consumer goods such as
sports equipment, shoes and clothing. The nation sent $26.9
billion of toys and sports items, $16.7 billion of footwear and
$33.5 billion of apparel to the U.S. in 2010, according to
Commerce Department data.

Imports from China have prompted a backlash among some
consumers and lawmakers worried about job losses in the U.S. and
the competitiveness of American-made products.

“The issue that we are dealing with now is: What is not
going to be made in China?” Senator Bernie Sanders, a Vermont
independent, said at a hearing Feb. 15.

Notre Dame said its policy on Chinese products is tied to
workers’ conditions in the world’s most populous nation. A
standards code adopted by the Catholic university in 1997
requires freedom of association and the “right for workers to
organize and form independent labor unions of their own
choosing.” It implemented the ban on Chinese products four
years later.

‘Economic Justice’

A human rights report released by the U.S. State Department
in April reinforced the university’s position, concluding that
Chinese law “does not provide for freedom of association, as
workers were not free to organize or join unions of their own
choosing.”

“Our approach has been informed by Catholic social
teaching, particularly the principle related to economic
justice,” Michael Low, Notre Dame’s director of licensing, said
in an e-mail.

Some sporting-goods companies have “decided against doing
business with the university” after reviewing the policy, Low
said. NorthPole LLC, a maker of camping and tailgating supplies,
has obtained all its branded portable chairs and canopies in
China, and thus couldn’t apply for a license from Notre Dame,
said Cheryl Cantwell, a brand development manager for the
privately held Washington, Missouri-based company.

“Most of these products are made in China,” she said in
an interview. The company is now tapping its tent-making factory
in Bangladesh to come up with canopy samples it can submit to
Notre Dame for approval, she said.

Slower, Costlier

Notre Dame’s requirements slow the introduction of products
by about a year or result in higher prices because of steeper
shipping costs or more convoluted transport channels, said Brian
Finegan, manager for licensing and business development at a
subsidiary of Jarden Corp. (JAH), a Rye, New York-based company that
sells canopies, footballs and other sporting goods under brands
such as Coleman and Rawlings.

“We can source products elsewhere, but our sourcing
leverage is sometimes limited,” Finegan said in an interview.
“Sourcing somewhere else solely for Notre Dame” creates longer
lead times, he said.

Adidas signed a 10-year contract with Notre Dame in 2005,
which the university said at the time would be valued at more
than $60 million. Adidas, which provides the varsity teams with
jerseys and footwear, complies with the prohibition on Chinese-
made goods, said Lauren Lamkin, a company spokeswoman.

“Fighting Irish” T-shirts sold by Herzogenaurach,
Germany-based Adidas on the campus in recent years were made in
Honduras, Nicaragua and the U.S., and baseball caps from other
companies were made in Haiti and Vietnam.

In addition to China, Notre Dame bars products from
countries including Saudi Arabia, Iran, Laos, Qatar and
Turkmenistan. None is a major supplier of sporting goods. Notre
Dame is also a member of the Fair Labor Association and the
Worker Rights Consortium, groups that monitor specific factories
for universities.

While laudable, Notre Dame’s policy may not do much to
change a country’s practices, according to Susan Aaronson, a
professor of international trade at George Washington University
in Washington. By staking out its own approach, Notre Dame loses
the impact of many universities putting collective pressure on
suppliers, she said.

“You have to have enough demanders of good labor
protections,” Aaronson, who writes about China and labor
rights, said in an interview. Notre Dame’s ban “is not a
mistake, but it is likely to have little impact on behavior in
China.”